More extreme sentiment

Our Advisor and Investor Model, which looks at sentiment readings from advisor and investor surveys, demonstrates extreme pessimism right now. The S&P had a very strong tendency to rally over the next 1-3 months when AIM was this low over the past 20 years.

The only bearish case over the next 3 months came in July 2008, just before global markets fell off a cliff. I don't think that case particularly applies today since most of our other studies demonstrate that the worst of the stock market's selloff is probably over.